The head of French oil group Total said Wednesday the company was assessing its presence in Nigeria because of unrest there but warned that any pull-out would cause a surge in already record oil prices.
“We have people who work over there … who are unfortunately more and more often subjected to major aggressions, (or) kidnapped,” chief executive Christophe de Margerie told a French parliamentary committee.
“We are asking ourselves the question (about staying),” he said, before adding that a decision to leave would send prices spiralling above their record of 135 dollars a barrel.
“I can tell you clearly that if Total or any other oil company decided to leave Nigeria for security reasons, it is not 130 dollars, it is X that you’ll have,” he said, using X as an unknown, higher value in the future.
Oil companies and their personnel in the Niger Delta are being increasingly targeted by separatist militants who have stepped up a campaign of kidnappings and sabotage.
The loss of production in Nigeria, about one quarter of its normal output, has been one of the factors behind the surge in oil prices over the last two years.
The latest figures from the Organisation of Petroleum Exporting Countries showed that Nigeria, previously the biggest oil producer in Africa, was surpassed by Angola in April.
Angola produced 1.873 million barrels per day on average in April, trumping the 1.818 million bpd produced by Nigeria.
Citing Nigeria’s daily output of nearly 2.0 million barrels of oil, the Total boss said that a withdrawal by his or any other major company would “confront us with a veritable energy shortage and prices would surge.”
Nigeria’s President Yar’adua, who has forecast a solution to the problems of the Delta within three years, plans to hold a summit on the question, including representatives of the major oil companies, in the next two months.
He is also trying to push through a development package for the region worth 79.4 billion naira (434 million euros, 673 million dollars). Separatist groups complain that while the Niger Delta accounts for 95 percent of Nigeria’s revenue, very little of it gets back to local people.
The Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA) estimated Wednesday the cost to the country from lost output over two years at 21.9 billion dollars.
“The nation cannot afford the continuing sustenance of this loss,” the association said.
It warned, “Without a solution to the Niger Delta Crisis, crude oil supply to the refineries, and dry gas supply to the existing and projected thermal power plants, cannot be guaranteed.”